Court File and Parties

COURT FILE NO.: CV-17-00568804

MOTION HEARD: 20211007

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: George Arvanitopoulos, Despina Arvanitopoulos, Eleni Arvanitopoulos and Mickael Arvanitopoulos, Plaintiffs

AND:

The Wawanesa Mutual Insurance Company, Defendant

BEFORE: Associate Justice B. McAfee

COUNSEL: D. Himelfarb, Counsel, for the Moving Parties, the Defendant A. Kwinter and S. Dhaliwal, Counsel, for the Responding Parties, the Plaintiffs

HEARD: October 7, 2021

Reasons for Decision

[1] The defendant moves pursuant to Rule 32 of the Rules of Civil Procedure for an order that the defendant’s appraiser J. Valeriote be allowed to forthwith conduct an inspection of the plaintiffs’ home (the plaintiffs’ property). The defendant also seeks an order that the appraiser be permitted to conduct the inspection with experts and/or construction professionals of his choosing. On the motion, defendant’s counsel confirmed that the experts and/or construction professionals are G. Burkes of Burkes Restoration and an engineer from Roar Engineering.

[2] The plaintiffs oppose the motion. On the motion, plaintiffs’ counsel confirmed that they would agree to an inspection pursuant to Rule 32 taking place after the conclusion of the appraisal.

[3] This action arises as a result of a fire that occurred on February 16, 2015, at the plaintiffs’ property. At the relevant times, the defendant insured the plaintiff’s property against various risks including fire loss.

[4] A statement of claim was issued on February 1, 2017. The plaintiffs seek damages in the total amount of $6,300,000.00. A notice of intent to defend is dated December 6, 2018. A demand for particulars was served on or about December 19, 2018. A response to demand for particulars was served on or about February 4, 2019. The statement of defence was served on or about September 11, 2019. The plaintiff has served an affidavit of documents. Examinations for discovery have not taken place.

[5] On or about February 15, 2019, the defendant elected to proceed to appraisal pursuant to the provisions of the Insurance Act, R.S.O. 1990, c.I.8. Following a motion and cross-motion on November 28, 2019 before Schabas J., the appraisal process has commenced.

[6] Rule 32 of the Rules of Civil Procedure provides in part as follows:

32.01(1) The court may make an order for the inspection of real or personal property where it appears to be necessary for the proper determination of an issue in a proceeding.

(2) For the purpose of the inspection, the court may,

(a) authorize entry on or into and the taking of temporary possession of any property in the possession of a party or of a person not a party;

(b) permit the measuring, surveying or photographing of the property in question, or of any particular object or operation on the property; and

(c) permit the taking of samples, the making of observations or the conducting of test or experiments.

[7] One of the objectives of Rule 32 is to level the playing field between the parties, where one party has exclusive access to the property (Farley Manufacturing Inc. v. Oz Optics Ltd., 2017 ONSC 3321 (Ont. S.C.J.) at para. 12 citing Tan-Jen Ltd. v. Di Pede, [2015] O.J. No. 2995 at para. 8)

[8] In Evans v. Snieg, 2019 ONSC 7270 (Ont. S.C.J.) A. A. Casullo J. states as follows:

[37] An inspection of property advances the interests of justice by aiding in the determination of an issue on its merits. In light of the general principle of interpretation outlined in r. 1.04(1), r. 32 is to be construed liberally, and a request for inspection should only be denied if there is evidence of some countervailing prejudice that would be occasioned by the order, or if the request constitutes an abuse of the rights conferred under r. 32.01: Morier v. Michelin North America (Canada) Inc., 2010 CarswellOnt 615, 88 C.P.C. (6th) 115 (Ont. S.C.J.), at paras. 21 and 24.

[9] The defendant seeks a Rule 32 inspection to obtain updated information and evidence regarding the condition of the property including what would be required for the remediation process having regard to the damages now alleged to have been caused as set out in the statement of claim.

[10] While the defendant did have access to and attended at the plaintiffs’ property prior to the commencement of the action, the defendant has not inspected the plaintiffs’ property since the commencement of the action. No reports or estimates served by the defendant post-date the commencement of this action. No inspection pursuant to Rule 32 has been conducted.

[11] The plaintiffs and their appraiser and experts have access to the plaintiffs’ property and have served six reports and estimates dated after the commencement of the action. While the plaintiffs take the position that the state of the plaintiffs’ property has not changed since the defendant last had access to the plaintiffs’ property prior to the commencement of the action, the defendant ought to be entitled to make its own determination in that regard and inspect the current state of the property.

[12] As noted above, the plaintiff agrees to a Rule 32 inspection taking place after the conclusion of the appraisal. The plaintiffs argue that permitting a Rule 32 inspection at this time would be unfair because of the delay in seeking the inspection. The plaintiffs also argue that the main purpose of the inspection is to undermine and challenge the reports and estimates submitted by the plaintiffs in the appraisal. The plaintiffs argue that if a Rule 32 inspection is granted, they will need to obtain responding reports and incur significant expense.

[13] I am satisfied that the defendant is entitled to a Rule 32 inspection at this time. The plaintiffs do not take the position that the commencement of the appraisal stays the action (56 King Inc. v. Aviva Canada Inc., 2017 ONCA 408 (C.A.) at paras. 5 and 6).

[14] I am not satisfied of delay in seeking a Rule 32 inspection. The decision of Adriatic Glass & Mirrors Ltd. v. Dolvin Mechanical Contractors Ltd., [1997] O.J. No. 5129 (Ont.Gen.Div.) relied upon by the plaintiffs in this regard can be distinguished. In Adriatic the motion for a Rule 32 inspection was brought 10 years after the commencement of the action, after examinations for discovery, after a pre-trial and after trial dates were set. Previous inspections had been conducted during the course of the action. In the within action, documentary discovery is not complete. No examinations for discovery have taken place. The action has not been set down for trial. No previous inspections have been conducted by the defendant during the course of the action. The action will not be delayed.

[15] The appraisal process has been underway since in or about 2019. Whether any report generated from the Rule 32 inspection can also be submitted for the purposes of the appraisal, together with any issues concerning timetabling in the appraisal, are issues for the Umpire to determine in the appraisal, not an Associate Judge. I was not asked to make such a determination in any event.

[16] Any costs incurred by the plaintiffs in responding to any reports served by the defendant following the Rule 32 inspection, are costs incurred as part of the litigation and may be addressed when addressing the issue of costs of the action. Such costs do not constitute prejudice or a basis to deny a Rule 32 inspection at this time.

[17] At paragraph 34 of the responding affidavit of the plaintiff’s appraiser G. Milnes, there is reference to the defendant’s acknowledgement that Burkes Restoration should not be permitted access to the plaintiffs’ property. At paragraph 10 of the statement of claim, the plaintiffs plead that the defendant, its agents, and employees caused additional damages to the property. The statement of defence denies these allegations. In its material, the defendant does not address the evidence concerning the defendant’s acknowledgement. Based on the evidence before me I am not prepared to permit Burkes Restoration to attend the Rule 32 inspection. I am ordering that the appraiser may bring an engineer from Roar Engineering.

[18] With respect to the issue of costs of the motion, notwithstanding the substantial success of the defendant, there shall be no costs of the motion payable to any party. This motion was previously before two other Associate Judges who adjourned the motion as a result of certain deficiencies on the part of the defendant regarding CaseLines and motion confirmation. While I am satisfied that the deficiencies were inadvertent, the plaintiffs did incur costs thrown away as a result of the adjournments. In addition, I have not permitted Burkes Restoration to attend the inspection.

[19] Order to go as follows:

1. The defendant’s appraiser J. Valeriote shall be permitted to attend at the plaintiffs’ property to conduct an inspection pursuant to Rule 32 forthwith.

2. The appraiser shall be permitted to bring with him to the inspection an engineer from Roar Engineering.

3. There shall be no costs of this motion payable to any party.

Associate Justice B. McAfee

Date: November 4, 2021